The Freed Corporation produces three products, X, Y, Z, from a single raw material input. Product Y can be sold at the split-off point for total annual revenues of $50,000, or it can be processed further at a total annual cost of $16,000 and then sold for $68,000. Which of the following statements is true concerning Product Y?
A. The annual financial advantage from processing Product Y further is $18,000.
B. Product Y should be sold at the split-off point rather than processed further.
C. The annual financial advantage from processing Product Y further is $2,000.
D. The annual financial advantage from processing Product Y further is $68,000.
Answer: C
You might also like to view...
Which of the following sections of the statement of cash flows includes purchases and sales of long-term assets?
A) the financing activities section B) the operating activities section C) the investing activities section D) the non-cash investing and financing section
For many firms, the largest single operating expense is
A. administrative overhead. B. research and development. C. product management. D. publicity. E. personal selling.
The statement of cash flows relies on a fundamental principle of double-entry bookkeeping; namely, the change in the cash balance must equal the change in total liabilities and stockholders' equity.
Answer the following statement true (T) or false (F)
Why do organizations need three types of leaders (local line leaders, executive leaders, internal networkers)? Use industry examples to support your answer.
What will be an ideal response?